patrick.net

It’s crazy when people make over 100k a year, and can’t afford a house.

Based on some napkin math I was doing at lunch, if you're making $100k, were single, and interest rates stay at 6.5% - it looks like you could finance a $500k mortgage fairly easily. Throw in another $100k for a downpay - and you could afford a house.

It might be a house in East San Jose though.

Austingal,

Hey, a sweet house on a nice piece of land that you got in foreclosure is probably a good thing. Just consider the mobile cost and 'rent' for the land it's on as schooling costs. You sound like you want the house for the 'long run' so overpaying a little isn't likely to be a huge deal for you guys.

Why in the world would you want to buy a 1 bed junior condo that you had to get a roommate and a loan from daddy in order to afford?

HAH! I posted the exact same comment a few hours ago:

http://www.burbed.com/2007/02/26/bay-area-is-1-in-median-home-prices-again/

That said, I bet her dad begged her to do this.

Why in the world would you want to buy a 1 bed junior condo that you had to get a roommate and a loan from daddy in order to afford?

A roommate in a 1 bed junior condo? :-~

Based on some napkin math I was doing at lunch, if you’re making $100k, were single, and interest rates stay at 6.5% - it looks like you could finance a $500k mortgage fairly easily. Throw in another $100k for a downpay - and you could afford a house.

Huh?

28% of 100K ~= 2333/month PITI. That ain't no 500K mortgage.

Oh, I was using 40%.

$100k - 40k goes to PITI. That's about $2900 a month. Which... hm... isn't a $500k. Only about $475k.

Scratch that.

eburbed,

Does your $100k person pay taxes, eat, have insurance payments, save for retirement, ever need clothing? Get haircuts, buy soap, do laundry?

I think 40% of gross would be near impossible to manage.

Does your $100k person pay taxes, eat, have insurance payments, save for retirement, ever need clothing? Get haircuts, buy soap, do laundry?

My napkin math:

$100k income
-40k for PITI
-30k for Taxes
+12k for Interest Deduction
-15.5k for 401k

That leaves about $26k disposable. That's about $2160 a month, or about $500 a week.

You'd never be able to go on vacation - but you can definitely afford the basics with that number.

Did I miss something big?

Not surprising though… almost everyone I saw who went to this Open House was Indian, Chinese, or otherwise Asian - and they all looked pretty First Gen:

Did you at least see some white guy with a Asian wife or girlfriend? Serves them right to be a FB for stealing our women :)

Did you at least see some white guy with a Asian wife or girlfriend? Serves them right to be a FB for stealing our women :)

No I did not. I think they were too busy walking down University Ave in Palo Alto, or being featured on the cover of magazines (I think AAA recently had one)

eburbed,

I think vacations are essential. I need to swim in a warm sea or go to the mountains or to great cities every now and then. I think it's good for the soul, and more important than owning stuff.

Your calculations would probably work for someone who had employer covered health and dental insurance and didn't go for much long distance travel.

Just to do some more math:

$26k disposable income
-1k for car insurance
-5k for car payments
-1k for DSL/Cell phone
-1k for new clothes

That's still 18k left ($347 week) in disposable income.

For a single person, that's not too bad. And, amazingly, this includes $15,500 in 401k savings - which probably puts the person in the Top 5% of savers in this country. :)

Your calculations would probably work for someone who had employer covered health and dental insurance and didn’t go for much long distance travel.

Oh... well.. yeah. I was thinking of an Apple/Yahoo/Intel/Cisco/Google/Tech Startup employee.

As for vacations - most of my California native friends only go to Tahoe or Vegas. I think it's believed that if you go too far from California, you'll die or something. (Unless it's Taiwan/Mumbai for family reasons.)

How’s the bubble unfolding there?

Suds, it's correcting in real time, especially in Ventura where I'll like buy. $B kind of actually sucks, the people here are icky.

CB wrote,

"Did you at least see some white guy with a Asian wife or girlfriend? Serves them right to be a FB for stealing our women"

Well, if that is what happened, at least you cannot accuse the guy of marrying his way into a green card after positioning himself with a Canadian residency. Could accuse the Asian wife of doing it maybe, but not the guy.